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Task Force in Rural Connecticut Explores Community’s Appetite for Fiber

The newly formed Utilities Task Force in the City of Redding, Connecticut, is exploring the potential of bringing fiber connectivity to this rural town of about 9,000 people. Redding is about 65 miles northeast of New York City and just 25 miles north of Stamford.

As part of their feasibility analysis, the task force sent a survey to residents and businesses to gauge interest in bringing a fiber network to Redding. While the analysis is still ongoing, task force board member Susan Clark expressed optimism. “I’ve been energized by how many people have shown interest in this,” Clark told the News Times.

The task force believes if the survey reveals strong interest in the community for the nascent project, private Internet providers would be more inclined to help the community build the network. Community leaders hope that a new fiber network would attract new residents such as “knowledge workers” who depend on reliable, highspeed Internet access that allows them to work from home.

A second member of the task force, Leon Kervelis, told the The Redding Pilot that the task force has hopes the proposed network, if built, could eventually grow beyond Redding: 

“It’s not intended to be a single town project…we’d get several towns together in a conglomerate, and that municipal conglomerate decides procedures and financing for the infrastructure,” he said.

Kervelis also explained the task force’s proposed plan for how to pay for the network, saying residents and businesses would pay a small surcharge on their property taxes, a far cry from current rates:

“The benefit would be significant,” he added. “Some people are already paying $120 a month to the cable company. Compared that to an [estimated] $10 to the town of Redding. For businesses and residents, this would drastically cut the cost of communicating rapidly and instantaneously. This would be a vast improvement over the services currently available in town.”

Clark said she originally got her inspiration to pursue a fiber optic network project in Redding after learning about the state’s CT Gig Project. The project involves “a coalition of municipalities, state officials, and other interested parties committed to bringing high-speed, low-cost internet to all residents and businesses in Connecticut.” 

We wrote about the development of the CT Gig Project in early 2015. For more information on the goals and current happenings with the CT Gig Project, you can visit their website here.

New Vermont Law Bolsters Prospects for Investing in Community Broadband Networks

A new state law is on the books in Vermont that supporters expect will encourage more investor activity supporting community broadband networks. 

The new law, which took effect this past June, allows for the creation of “communications union districts,” enabling towns and cities to band together to form geographic entities dedicated to establishing fiber-optic broadband networks for their area’s residents and businesses. 

A New Nomenclature

While Vermont towns have been able to work cooperatively via inter-local contracts, the new law is less cumbersome and uses a governmental nomenclature more familiar to most people—the union district. The union district governance model has been used for many years throughout Vermont, including by various utilities that have multi-town operations to handle, for example, sewer and water service.  

Carole Monroe; general manager of the East Central Vermont Community Fiber-Optic Network (ECFiber), a consortium of 24 Vermont communities that have banded together to provide broadband service; told our Christopher Mitchell there isn’t much practical difference for her group operating now as the East Central Vermont Telecommunications District instead of by an inter-local contract.  

“But I can say that in the municipal investment markets, they’re much more familiar with the municipal utility district, whether it’s a water district or sewer district or something along those lines,” Monroe told Chris in a recent edition of Community Broadband Bits podcast. “A municipal utility district is a common language for them. Inter-local contracts, not so much.” 

ECFiber Grew From Inter-Local Contract 

Irvin Thomae, chairman of the EC Vermont Telecommunications District board, agreed. He noted that seven years ago the east central Vermont communities created ECFiber through an inter-local contract. “But this (the inter-local contract) was unfamiliar to investors beyond our state borders,” Thomae told us.

“We needed a structure more capable of being recognized by large institutional investors. It (the communications union district) makes it easier for community broadband networks to appeal more for large investors.”

Jerry Ward, an ECFiber delegate from Randolph Center, earlier in 2015 urged residents of his community to vote to approve the governance change to a telecommunications utility district. He predicted in an opinion article in The Herald of Randolph, the union district model will be a boon for ECFiber: 

“Most of the money we’ve raised until now has come in small multiples of $2,500. The governance structure allowed by a Telecommunications Municipal Utility District should help ECFiber attract larger investors at more favorable interest rates. We expect that reorganizing along the lines of a municipal utility district will make it significantly easier to borrow enough money to build out our network much more rapidly than the 50 miles/year we’ve averaged so far.”

During the past four years, ECFiber, under its inter-local contract, has borrowed more than $7 million from predominantly about 450 local investors, connecting nearly 1,200 customers in parts of about a dozen towns, along 200 road miles of fiber-optic cable. Its customers include residents, businesses and institutions. The vast majority of the 24 towns in the ECFiber district are communities of less than 2,000 residents with a handful boasting between 4,800 to 10,000 people. 

Ward noted thousands of other residents still don’t have access to high-speed Internet.  “The rate at which we (ECFiber) can grow depends almost entirely on capital,” he said.  EC Fiber became a communications union district shortly after Vermont Gov. Peter Shumlin signed the new law on June 1, 2015.

ECFiber offers latest Internet speeds

Currently, ECFiber offers the latest generation symmetrical Internet access and a choice of five speeds (from 7 Mbps to 400 Mbps) that do not vary by time of day or according to the weather - as well as phone service with unlimited long-distance calling in the U.S. and Canada, according to its website.

Under Vermont’s communications union districts, the member towns can help facilitate the broadband networks with obtaining easements from property owners along the fiber-optic cable routes, including putting up poles and laying conduit. ECFiber’s union district board is comprised of one delegate per town with each community also able to send one or two alternate delegates to the board’s monthly meeting. 

Under the new Vermont law, a communications union district, such as EC Vermont Telecommunications, isn’t allowed to assess taxes for the initiative. (Note: This was also true for ECFiber when it carried out its operations under its inter-local contract.) A communications union district’s revenue come from subscriber fees. Currently, the ECFiber district is generating about $125,000 a month in subscriber fees, Thomae told us. 

Currently, while ECFiber is the only communications union district in Vermont, Thomae said he has had a few inquiries from other people in the state asking about the new governance structure. 

Monroe said the creation of the ECFiber network has given people in Vermont’s rural east central region an alternative to DSL service, which usually is poor at best. For people not connected to a high quality network, fast and reliable Internet service also can be a problem because the East Central region’s mountainous terrain inhibits satellite service and reception from cell towers, she told us.   

Montana Coop Turns Up the Speed: 16 Counties, 23,000 Square Miles

Montana may have high speed limits on roads, but this Montana coop’s network will let you surf the web even faster. Triangle Communications received an almost $30 million loan from the USDA to provide rural Central Montana with high-speed Internet access.

Triangle Communications will finish upgrading its aging copper network - a technology mostly used for telephone - to a fiber network that can support both telephone and high-speed Internet. The loan comes from the USDA’s initiative, announced in July, promising $85 million to improve connectivity in rural areas. The Triangle Communications coop is upgrading its entire system spanning 16 counties (that’s more than 23,000 square miles from the Canadian to the Wyoming border!). 

Since 1953, the coop has been at the forefront of changing technologies. It’s based in Havre but expanded in 1994 with the purchase of 13 exchanges from US West (now known as CenturyLink). The coop began upgrading to fiber in 2009 in order to provide its members with state-of-the-art service and technology.

For more information about the network and the award, check out local news coverage of the almost $30 million loan and Triangle Communications’ video.

 

“Crazy Fast” Connectivity Expands in Westminster, Maryland

Gigabit Internet access will soon be reaching more residents in Westminster. The high-speed municipal fiber-to-the-home (FTTH) network in Maryland will soon add more than 2,000 new homes to the network map.

The Incredible Expanding Network

The network is a product of a public-private partnership with telecommunications company Ting. The expansion provides more evidence of the continuing success of the network in this city of just under 19,000 people about 35 miles northwest of Baltimore.

The network was originally planned as a pilot project confined to small, select areas of Westminster, but high demand prompted community leaders to broaden the reach of the project. Eventually, Westminster budgeted for citywide infrastructure.

City Manager of the Ting project, Valerie Bortz, recently said of the network "we are super busy and happy with our progress.” In October 2015, the city released an RFP calling for bids from contractors to provide maintenance on the expanding network - more proof of the city's commitment to ensure the network’s growth and success.

More Money, More Fiber

The Phase 2 expansion was made possible by a $21 million general obligation bond agreement with SunTrust Bank, approved at a September City Council meeting. According to Common Council President Robert Wack, the bank’s willingness to buy the bonds came in part as a result of the proven high demand for fast, reliable, affordable, symmetrical fiber service in Westminster. He also added:

We don't want to spend money unless there is revenue from the payments to support the debt payments. The bank liked the fact we were being cautious about this. I'd like to go full steam ahead but we need people to sign up.

The bond agreement has been in the works for some time now:

All along, our plan was to borrow the money necessary to continue the build out. We are getting ready to take down the first draw that will be spent on engineering the next phase.

The city will pay off the bonds on a 30-year amortization schedule but have the option to convert the debt to a 15-year schedule if they find profits from the network allow a faster payment schedule. The city’s ability to pay off the loan faster will depend on the success of the network. The city can draw off the $21 million in bonds for five years.

Growth of the Partnership

Beyond this second phase of the project, Wack expressed optimism about the timetable for completing the two additional phases in the network map. "Ideally, we'd like to be done in three to four years, but it could easily go five to six," he said. Construction variables and the rate of new subscribership will influence the timetable.

In January 2015, Westminster and Ting entered into a partnership which was recognized as 2015’s “Community Broadband Innovative Partnership of the Year” by the National Association of Telecommunications Officers and Advisors (NATOA). The city owns, funds, and maintains the network while Ting has a 2 year exclusivity contract to lease the fiber and provide equipment and retail services. At the end of 2 years, the city will have the right to invite other providers to offer services via the infrastructure.

Ting, which markets itself as a provider of “crazy fast” fiber Internet service, also provides high speed broadband service in Charlottesville, Virginia with plans to make Holly Springs, North Carolina the next “Ting Internet Town.”

Listen to Chris interview Dr. Robert Wack, the man who spearheaded the initiative, in episode 100, and Tucows CEO Elliot Noss, parent company of Ting, in episode 134 of the Community Broadband Bits podcast.

Upper Arlington, Ohio Forges Ahead with Public Partners on City-wide Fiber-Optic Network

The City Council of Upper Arlington, Ohio on Oct. 26 approved several contracts that will enable the community to build a municipal fiber-optic network to key anchor institutions for an estimated $2.5 million.

Upper Arlington’s project will provide high-speed Internet service for the city’s buildings, the Public Library, Upper Arlington city schools, and most city parks according to a news report from the Upper Arlington News. The 30-mile fiber network will serve about 40 locations around the boundaries of the city (population 34,000).

Besides establishing better connectivity between the three public partners’ buildings, the network is expected to provide opportunities for commercial companies to lease telecommunications services. The network would allow the city to lease some of the 288 fiber strands to commercial companies, such as other Internet Service Providers (ISPs).

Financing and Break Even

Under the cooperative arrangement, the library will contribute $17,616 annually, the city $68,484 per year and the school district $177,900 each year until the project is paid off. “These costs are derived from the amounts that each entity is currently paying for leased broadband connectivity between their facilities,” Upper Arlington Assistant City Manager Dan Ralley told us. 

The period anticipated to pay off the network construction is nine years with the school district and library able to extend the parties’ shared-services agreement for an additional 15 years after. The extensions would occur in three five-year segments.

Cost savings, broader bandwith

Ralley says the primary benefits of the new city fiber-optic network will be significantly lower long-term bandwidth and broadband access costs.  For example, the city of Upper Arlington expects to save about $1,280 a month for Internet service by building its own fiber network. Over 10 years, the city’s savings would total about $150,000.

And the municipal network will be a boon for the Upper Arlington public schools. In an Oct. 19, 2015 staff report, Ralley said:

Upper Arlington Schools’ available bandwith capacity is a growing concern given the current and future 21st century learning initiatives that are premised upon the use of technology. With increased bandwith between buildings, the potential for ubiquitous computing is possible along with more collaborative learning tools delivered through online learning management systems.

Network will enable access to two major data centers

Another benefit: the new network will enable Upper Arlington to “gain direct access to two different data centers located on the periphery of our community,” Ralley told us. Those are “the Ohio Supercomputing Center and a private facility owned by Expedient that will allow us to locate our servers in a carrier neutral facility that has redundant power feeds and lower broadband access costs,” he noted. 

“Expedient can provide the City an internet connection of 30 Mbps which is burstable to 100 Mbps at a much lower cost than our current provider,” Ralley said in his Oct. 19 staff report. 

New network incentive for economic development

Not to be overlooked, Upper Arlington’s new fiber-optic network is also expected to boost the community’s desirability for economic development.

“The number of businesses that are looking for access to affordable, high bandwith is increasing,” Ralley said in his staff report. He added:

While Upper Arlington does not have a large number of businesses that would typically utilize fiber optic data connections, we have attractive commercial development areas where access to available fiber can be used to attract businesses that require large bandwith. The City could leverage the community fiber optic network for economic development incentives or use it to help lower the cost of operating a business in UA, thereby providing a competitive advantage.

In one case, the city will be providing dark fiber to a new Ohio State University Medical facility that is currently under construction, Ralley told us. That arrangement is a condition of a $500,000 grant that the state of Ohio has given Upper Arlington to build its fiber-optic network. Dark fiber, fiber-optic cable currently not in use, is particularly important for medical centers because it offers more control over network quality and allows for very fast networks at affordable budgets. 

Also the city will be entering into an IRU (Indefeasible Right of Use) with the fiber construction contractor Thayer, that will enable them to market and sublease fiber strands by other third parties, he said.

Given the direction of the Upper Arlington broadband network, the community will be getting a system that will have many potential benefits but little risk with the city serving as its anchor tenant.

Self-Financed EC Fiber Continues to Grow - Community Broadband Bits Podcast 177

Carole Monroe is back on Community Broadband Bits for Episode 177 this week, to discuss the East Central Vermont Fiber network and its unique financing model. Carole is now the General Manager for EC Fiber. She previously joined us for episode 36 to discuss Fast Roads in New Hampshire. And we previously discussed EC Fiber with Leslie Nulty in episode 9.

Years later, EC Fiber is approaching 1,200 subscribers in rural Vermont and is growing much more rapidly with some open access dark fiber connections created by the state in a specific effort to enable last mile connectivity.

We discuss the impact on the community, how much people in rural regions desire high quality Internet access rather than slow DSL, and also a brief mention of some progress in New Hampshire to expand the Fast Roads network.

Read the transcript from this episode here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 21 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

You can can download this Mp3 file directly from here. Listen to other episodes here or view all episodes in our index.

Thanks to Arne Huseby for the music, licensed using Creative Commons. The song is "Warm Duck Shuffle."

Audio Available: Financing Fiber for the New Economy Conference in Lexington

At a September conference in Lexington, Kentucky, Next Century Cities (NCC) hosted an influential and diverse group of leaders from the municipal broadband arena to share their experiences as leaders in community broadband. Four audio recordings, which you can find on NCC’s website, include panel discussions on a variety of issues surrounding the topic of financing for next generation broadband.

Recording #1: “Lexington Mayor Jim Gray and the Kentucky Wired Story”

In the first recording, Lexington Mayor Gray and the city’s Chief Information Officer discuss their ongoing efforts to make Lexington a gigabit city. These efforts are part of a broader initiative also discussed on building a statewide 3,000 mile fiber optic ring. Several Kentucky government leaders make remarks about the project, called Kentucky Wired, including their thoughts about the public-private partnership model that is helping make the project possible.

Recording #2: “Achieving the Last Mile

Our own Christopher Mitchell, the Director of the Community Broadband Networks Initiative at ILSR and the Policy Director for Next Century Cities, moderates this panel that includes officials who have led municipal broadband initiatives in their communities. These officials share some of the challenges they have faced and solutions they discovered in their efforts to finance last mile infrastructure.

Recording #3: “Exploring Options and Approaches for Broadband Financing”

Scott Shapiro, the Senior Advisor to the Mayor of Lexington Kentucky, moderates the panel discussion that includes a group of people with varied knowledge and perspectives on the community broadband issue.  They discuss models and approaches communities can use to finance their broadband networks, with a particular focus on the public-private partnership model.

Recording #4: “Federal Support for Broadband Projects” 

Hilda Legg, former Rural Utilities Service Administrator and current Vice Chair of Broadband Communities, leads a panel of several experts examining funding supports and offering recommendations and next steps for communities.

If you could not make the conference or if you need a refresher on information you found compelling, this is your opportunity to revisit the discussion.

Sanford, Maine Plans Largest Municipal Network in the State

A lot has happened in Sanford, Maine since our last report on their municipal fiber optic network discussions. After a year of deliberations over different proposals, the city recently announced plans to begin building a 32-mile municipal fiber-optic network.

The city of Sanford is inside York County, situated about 35 miles southwest of Portland. The network will provide connectivity to businesses, government entities, non-profit organizations, and residences in Sanford along a limited route where there is sufficient customer density. City leaders plan to also provide a foundation for future expansion of the network to additional residential areas in the city. The network will be open access, allowing multiple ISPs to provide services via the publicly owned infrastructure.

The city will partner with Maine-based company GWI (Great Works Internet) to operate the network. Readers may recognize GWI as the same company working with Rockport, Maine's first community to invest in a municipal fiber network.

Once they complete the buildout, Sanford will be in an elite class of a just few cities nationwide that provide widespread access to 10 Gbps broadband. It is a bold plan for this city of just over 20,000 in a state that last year ranked 49th in the nation in average broadband speeds.

The Sanford Regional Economic Growth Council, a major driving force behind the project, sees the project as critical to their broader economic development efforts:

Like the growth council, this project is a public-private partnership stemming from the exploration of a best business model allowing for municipal investment and input while leveraging the strengths and expertise of private sector for-profit business. The growth council recognizes the collaboration of the public private partnership as the best means to accomplish the City’s economic development strategies.

The new network is also the first major loop in Maine that will connect to the state’s existing Three Ring Binder network. Constructed in 2012, the middle-mile Three Ring Binder spans 1,100 miles around much of Maine. The network was a product of private investments and $25 million in stimulus money from the 2009 American Recovery and Reinvestment Act

According to a study commissioned by the Economic Growth Council, the network could generate between $47 million and $192 million in economic benefits over the next decade. The Economic Growth Council and the the city are still seeking funding to build the network, estimated at $1.5 million. The city expects to cover costs through agreements they’re pursuing with anchor institutions and savings they'll see by eliminating the cost of leasing lines to city government buildings and schools.

The city is also considering Tax Increment Financing (TIF), a process we described in a previous article about another network using the process:

“Tax Increment Financing (TIF) is a method of public financing that uses future gains in property or sales taxes within a defined area to subsidize a redevelopment or infrastructure project. A local jurisdiction can borrow money up front, build the project, and then use the increased tax receipts it generates to pay off the debt over a period of years. The concept is actually pretty simple: capture the value that something will have in the future to build it now.”

A small number of municipal broadband projects have been funded with TIF, but this arrangement can be controversial as it removes substantial property value from the general taxbase. Most choose revenue bonds, interdepartmental loans, or by redirecting savings gained when city can build incrementally thereby avoiding payments for leasing lines from providers. Fortunately, Maine remains one of the states where local communities have the freedom to choose whether or not they invest in Internet networks and how they finance such a project.

At the meeting to announce plans for the network, U.S. Senator from Maine, Angus King, summed up the network's importance to the state's future:

“High-speed broadband is a gateway to economic and educational opportunity in the 21st century,” King said. “But right now, there are too many people who are denied those opportunities simply because they don’t have adequate Internet access.”

Peachtree City, Georgia Approves Resolution to Establish Municipal Broadband Utility

At a September meeting, the City Council in Peachtree City, Georgia unanimously approved a resolution to construct and operate a fiber-optic broadband network.  According to the City Council minutes from the meeting, the initial 22.54-miles of fiber will provide 1 Gbps broadband access to various facilities in the City Service area.

In addition to providing connectivity for government buildings, utility services, and medical and educational buildings, the city will target business customers in the “high end user category.”

Officials estimate the network will cost $3.23 million. To pay for the project, the Peachtree City Public Facilities Authority, an independent local government authority created by the state legislature in 2011, will enter into an intergovernmental agreement with Peachtree City. According the August 2015 Fiber Initiative plan, capital for the project will come from the Authority; the city will issue a bond and pay installments to the Authority under an Agreement of Sale.

For several years now, the city located 30 miles southeast of Atlanta has explored options to improve local connectivity. City leaders tried and failed to bring Google Fiber to the community of 35,000 people in 2010. The city attempted repeatedly to urge private ISPs like AT&T to address the problem with no success. In February of this year, city leaders began work on a study to explore the feasibility of a publicly owned fiber network.

City Council members citizens at the recent City Council meeting expressed concerns that the network will not pay for itself and taxpayers will be left to cover unpaid costs. According to a recent survey of local businesses, 100% of respondents reacted positively to the prospect of a municipal network for connectivity.

In order to achieve the plan’s objectives, the network will need 12 “high-end” commercial customers by the end of year 2.  The city’s consultant expressed confidence in meeting that first goal:

“If we had a different experience, I would be standing up here in front of you saying 12 is going to be a stretch. However, we found exactly the opposite to be the case,” said Davis. “I was amazed by that. It’s a surprise to me that the demand was so great, and that the existing customer base out there was so positive about becoming a user. From a pure business standpoint, that gave me a lot of confidence to come in and say I believe we can hit this number and I believe we can exceed this number.”

The city’s Financial Services Director Paul Salvatore added that the business plan for the project is based on conservative assumptions.  It relies on a 20-year financial model projecting success for the network if the city secures at least 12 non-governmental customers in addition to 17 serviceable government sites. Thereafter, if it reaches at least 19 total non-governmental customers by year 6, the network will start to achieve positive gains, a 10-year bond payoff, and profitability after 16 to 20 years.  

City officials have no plans to bring the network to residential subscribers at this stage, choosing instead to focus on direct and indirect economic development benefits, public safety improvements, and better cell phone coverage that will likely result from the fiber deployment. They did not rule out the prospect of fiber for residents in the future. (Watch a complete video of the September 17th City Council meeting here, the city’s municipal broadband network discussion starts at 28:20.)

At a workshop earlier in September, city leaders met with the consultant to finalize the business plan for the network. At the meeting, Interim City Manager Jon Rorie quizzed the City Council about the risks involved with investing in the new broadband network. By the time the City Council met 9 days later, Rorie was convinced of the plan’s prospects for success: 

“We recognize this is a big decision, and it is of a visionary nature, but we also recognize that there is a risk exposure as a business model,” he said. “As far as providing an opportunity from an economic development perspective, I do think it is a huge opportunity as we move forward.

Muni Fiber in Idaho Helps 911 Dispatch and First Responders - Community Broadband Bits Episode 173

Ammon, Idaho, continues to quietly build a future-looking open access fiber network. Though the City won't be providing services directly to subscribers, the network it is building and the model it has created could revolutionize public safety.

I just spent several days with them shooting our next video on community fiber networks (look for that in January). In episode 173 of our Community Broadband Bits podcast, we talk with City Technology Director Bruce Patterson and Systems Network Administrator Ty Ashcraft.

Bruce explains how they plan to finance the network as it moves from the current residential pilot phase to being available broadly to any residents that want to connect, likely using a local improvement district model. Then Ty tells us about the portal that subscribers will be able to use to instantaneously pick and change service providers offering various services.

Additionally, we talk about the public safety implications of their technological and collaborative approach, specifically around the horrifying prospect of an armed shooter in a public space like a school or mall.

Read the transcript from this episode here.

We spoke with Bruce about Ammon's plans previously in episode 86. Read all our coverage of Ammon here.

We want your feedback and suggestions for the show - please e-mail us or leave a comment below.

This show is 25 minutes long and can be played below on this page or via iTunes or via the tool of your choice using this feed.

Listen to other episodes here or view all episodes in our index. You can can download this Mp3 file directly from here.

Thanks to bkfm-b-side for the music, licensed using Creative Commons. The song is "Raise Your Hands."